I realized I had a friend at work using the standard remote with his MCE system. Running Spy++ on his system and typing "4" twice (to get an "h") revealed the following:
<00258> 000301DC P WM_KEYDOWN nVirtKey:'4' cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:0 fUp:0
<00259> 000301DC P WM_CHAR chCharCode:'4' (52) cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:0 fUp:0
<00260> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
<00261> 000301DC P message:0x00FF [Unknown] wParam:00000000 lParam:006802E9
<00262> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
<00263> 000301DC P WM_KEYUP nVirtKey:'4' cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:1 fUp:1
<00264> 000301DC P message:0x00FF [Unknown] wParam:00000000 lParam:006902E9
<00265> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
<00266> 000301DC P WM_KEYDOWN nVirtKey:'4' cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:0 fUp:0
<00267> 000301DC P WM_CHAR chCharCode:'4' (52) cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:0 fUp:0
<00268> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
<00269> 000301DC P message:0x00FF [Unknown] wParam:00000000 lParam:006A02E9
<00270> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
<00271> 000301DC P WM_KEYUP nVirtKey:'4' cRepeat:1 ScanCode:05 fExtended:0 fAltDown:0 fRepeat:1 fUp:1
<00272> 000301DC P message:0x00FF [Unknown] wParam:00000000 lParam:006C02E9
<00273> 000301DC P message:0x0402 [User-defined:WM_USER+2] wParam:00000000 lParam:00000000
The 0x00FF message is particularly interesting as this is the WM_INPUT message and tells us that MCE is using raw input (an application needs to ask for it to get these messages). Within this message there is information about what type of device generated the input (RIM_TYPEHID, RIM_TYPEKEYBOARD, RIM_TYPEMOUSE) where RIM_TYPEHID means "other Human Interface Devices".
My guess is that MCE only does the text message style input when input is coming from something that looks like a remote control, or at least isn't the keyboard. The next step in this adventure should be to write a little utility that registers for raw input and writes out the interesting fields so we can see how these fields are actually set. I can arrange to try it on my friend's system and then compare the raw data with the one from my Remote Wonder. So, any volunteers for this? 
If we can verify the above, the fix would then be to get RwKeyMaster (or something similar) send its keystrokes in "HID" style.
WM_INPUT docs: http://msdn.microsoft.com/library/default.asp?url=/library/en-us/winui/winui/windowsuserinterface/userinput/rawinput/rawinputreference/rawinputmessages/wm_input.asp
Raw input docs: http://msdn.microsoft.com/library/default.asp?url=/library/en-us/winui/winui/windowsuserinterface/userinput/rawinput.asp
//Mike